Shopify-backed Global-E rises on first post-IPO day and CEO says firm has 'great potential’
May 12, 2021 5:08 PM ET Global-e Online Ltd. (GLBE) By: Jerry Kronenberg, SA News Editor 6 Comments
Shopify-backed e-commerce firm Global-E Online (NASDAQ: GLBE) rose slightly Wednesday in its first trading day after a well-received IPO, and the company’s CEO told Seeking Alpha he’s glad the stock did so well on a tough Wall Street day.
GLBE shares gained as much as 3.3% to trade at $25.82 before closing at a preliminary $25.50, up 2% on the session even as all three major U.S. indexes sank and the tech-heavy Nasdaq Composite lost 2.7%.
Global-E’s initial public offering priced at $25 a share – the top of its expected $23-$25 range. That valued the Israeli-based firm at about $3.6B on a non-diluted basis even before Wednesday’s modest gains.
GLBE co-founder and CEO Amir Schlachet told Seeking Alpha that “in a market that is bright red with a lot of tech stocks tanking, I think [pricing] at the top of the range and holding that issuance price -- all things considered, we're happy.”
Global-E helps some 400 e-commerce merchants and brands like Versace and Hugo Boss easily sell their wares around the world by translating Web sites into local languages and handling shipping, duties, foreign currencies, merchandise returns and more.
“We work with brands and retailers from all around the world, and we enable them to trade cross-border, direct-to-consumer, to more than 200 markets,” Schlachet said.
He said the company provides clients with two things -- advice on best practices in each market, coupled with “the entire end to end suite of capabilities that they need in order to trade internationally.”
Schlachet said Global-E’s research shows that clients enjoy 60% better sales-conversion rates vs. what companies can do by just offering local versions of their e-commerce sites in various countries.
“You get to enjoy the best of both worlds,” he said. “You keep full control as a merchant, but you take care of all the localization that is needed in an optimal way, using our data-driven insights that are based on more than 4.5 million transactions that we've done just in the last year.”  (Global-E CEO Amir Schlachet. Photo courtesy of Global-E)
A-list investors seem impressed. The company’s pre-IPO backers included Red Dot Capital Partners, Goor HoldCo and funds affiliated with or managed by Vitruvian Partners. Strategic investors included funds tied to shipping giant DHL and to e-commerce powerhouse Shopify (NYSE: SHOP), which owns about 5.5% of the firm.
Global-E added in its F-1 filing with the U.S. Securities and Exchange Commission that funds affiliated with Dragoneer Investment Group also expressed a non-binding interest in buying 2M IPO shares.
GLBE expects to net more than $330M from the IPO, which it intends to use for general corporate purposes and possible future acquisitions.
Schlachet told Seeking Alpha that the firm expects to acquire some businesses that will help it provide clients with even greater end-to-end solutions for cross-border commerce. He also said GLBE expand further globally, particularly in the Asia-Pacific region.
“There's still a lot of green field ahead of us, and we believe that with the market recognition that comes with an IPO event, we will be able to push that even further,” he said.
As for why investors should consider GLBE’s shares, Schlachet said that “the main reason to buy the stock obviously is, in my view, for the great potential ahead of us. We're riding on very significant secular winds of e-commerce in general [and] cross-border e-commerce in particular. And I think the recent pandemic has brought this even further into the spotlight for both merchants and shoppers.” |
